The Maldives Monetary Authority (MMA) has revealed its intention to connect all banks within the country to Favara, the Maldives Instant Payment System (IPS), by the end of this year.
Favara was developed by MMA and offers innovative, convenient, and affordable access to digital financial services, enabling users to make and receive payments instantly. The first three banks to join IPS include the Bank of Maldives (BML), the Maldives Islamic Bank (MIB), and the State Bank of India.
Speaking at a press conference, the Executive Director of the Payment Systems and Oversight Division at MMA Hawwa Latheef revealed that IPS has been launched following an extensive pilot testing phase that facilitated the integration of three banks into the system. She said that an ongoing testing involving four additional banks is underway to potentially incorporate them into the system. She expressed that these banks would be fully prepared for integration by the end of September and she said that MMA intends to connect all banks in the Maldives by the end of this year.
Additionally, Hawwa said that MMA is actively engaged in developing the Favara application. She elaborated that in the second phase, the application will also enable services through e-wallets. She highlighted the collaborative efforts with Ooredoo Maldives and Dhiraagu, companies that presently offer e-wallet services, in the pursuit of the endeavor.
Favara is expected to revolutionise payment services in the country by enhancing the services of businesses and making them more accessible. The customisable design of the system promotes the execution and access of payment services across the country. The system will encourage economic growth by promoting fintech and e-commerce services, providing opportunities for entrepreneurs and youth, and significantly increasing national production.
Favara includes instant payment, request to pay, smart addressing, and account verification services. MMA stated that the payment system will allow citizens living on an island in the Maldives to open an account at any bank and instantly make transactions. The first phase of the instant payment system adoption prioritises enhancing internal financial transactions using a Favara ID. The second phase will connect the system to the national payment systems of other countries to facilitate instant foreign currency transactions.